Diamond, Peter and Felli, Leonardo (1993) Search, sticky prices and deflation. Mimeo.
Full text not available from this repository.Abstract
This paper examines equilibrium in a deflationary environment, in a market with free entry where consumers search and firms set prices on individual units of the commodity. Prices attached to newly produced goods are continuously adjusted. Prices attached to previously produced goods can only be changed at a cost. Deflation cuts into the market power created by the need to search for the good. Thus consumers' welfare is inverse u-shaped in deflation.
| Item Type: | Article |
|---|---|
| Additional Information: | © 1993 The authors |
| Divisions: | Financial Markets Group Economics STICERD |
| Subjects: | H Social Sciences > HB Economic Theory |
| Date Deposited: | 06 Feb 2009 11:03 |
| Last Modified: | 13 Sep 2024 21:00 |
| URI: | http://eprints.lse.ac.uk/id/eprint/4698 |
Actions (login required)
 |
View Item |
